Taiichi Ohno and Toyota Production System

Presented By Raj Kishor Singh ACCMAN Institute of Management

EXECUTIVE SUMMARY


In 2004 Toyota motor achieve a record results in revenues and operating Income of $163 billion & $15 billion high respectively.

Contribution of Toyota production system (TPS) introduction of just in time (JIT) & kaizen to develop and improve the production system.

Introduction of Kanban to minimize the shortcomings of JIT.

Taiichi Ohno was the person to develop the TPS by reducing wastes.

 Toyotas

competitors also acknowledged the TPS to be the good One. involves a flexible batch process.

 TPS

 

Introduction of Jidoka to improve the TPS. Keeping in mind the customers demand and to reduce the defects in the production process Toyota introduce lean manufacturing process. follows the process of craft and mass production to add a bit of betterment in the production process.

 Toyota

History
  

In 1897:- SakichiToyoda diversified his business. In 1902:- SakichiToyoda formed the parent group of TOYOTA In1926:-Formation Toyoda Automatic Loom Works (TALW) to manufacturing Loom workers In 1933:- Formation of Automobile department within TALW. In 1935:- First Passenger car prototype was developed. In 1936:- Sakichi sold the patent rights of his Automatic loom to a UK based Company. In 1947:- The passenger cars production began. In 1950-1955:- Foundation of Kanban System.

  

 

In 1957:- Eijji Renamed Toyota as The Toyota Company In 1968:- Toyotas first export to the USA. In 1970:- Major boost in the Japan due to oil crises. In 1980:- Toyota brought TPS in the USA with a Joint Venture to the GM (by Taiichi Ohno) In 1983:- Companys name changed to Toyota motor Corporation. In 1988:- Toyota Opened its New plant in Georgetown. In1999-2000:- Toyota listed on NYSE & LSE and become one of the top manufactures of cars in the world.

TOYOTA PRODUCTION SYSTEM (TPS)



It tries to overcome the deficiencies or limitation of production , while making the most of the available resources. Also tries to increase the efficiency of production by eliminating wastes and lowering costs. JIT , KANBAN and KAIZEN involve in developing TPS.

TPS involves a flexible batch process, with multipurpose capital equipment and cross trained workers supplied by JIT inventory. Also focuses on developing strong relations with suppliers.

OHNOS SEVEN WASTES

 Defects  Over

Production

 Waiting Time  Transporting  Movements  Inappropriate  Inventory

Processing

JUST IN TIME
 JIT

was the foundation of the TPS.

 Eliminate

waste of all kind by producing or supply materials only when they were needed and not and earlier. the necessary products, at the necessary time and in the necessary quantity to keep stock at minimum. process.

 Only

 Smoother

Kanban
In the kanban system, workers of a process needing components,wrote the details about the kinds of units needed and the quantity in which they were needed on a card called the kanban.  A set comprised two types of kanban: The Withdrawal kanban  The Production kanban  By early 2000s,kanban has evolved into a sophisticated inventory management tool that ensure production in the required quantities at the right time in manufacturing process within a factory.


Ohnos Kanban Formulae:

Y= Number of Kanban D= Demand per unit time Tw=waiting Tw=waiting time for kanban Tp=Processing Tp=Processing time a=Container capacity =Policy variable

D(Tw  Tp)(1  E ) Y! a

Kaizen:
y y

y y y y

Kaizen means continous improvement. Kaizen required all employees to participate in eliminating all activities that were classified as wastes from the production system. Kaizen is a continous process, and not periodic. Kaizen involved a great deal of observation of workers and their work process. Why methodology. The focus of Kaizen was not to identify a problem and to develop a solution, but to understand the problem all its alternatives thoroughly.

The Human Element and Jidoka:Jidoka:

Human element played an important role in TPS: y Shifinka:Most of the workers were cross-trained and could be shifted between different production lines. Any employee at any level of hierarchy had a right to make improvement in process. y Jidoka:This empowered workers to stop the equipment or operation in a line whenever an abnormal or defective condition arose in the line.

Jidoka System
 It is the system to get a quality product
It minimizes the defects  It creates quick signal towards any kind of problem incurred in the manufacturing process.  Creates motivation in the mind of the employees as the optimal perfection is there.  Reduces the labor cost up to some extent.


LEAN MANUFACTURING
 JOHN CRAFCRICK first coined the term lean manufacturing in the late 1980s.  The concept was based on the philosophy of Toyota production system.  It manufactured better quality products with lower defect rate and at greater speed than its competitors . Lean manufacturing is lean because it uses less of every thing half the manufacturing space, half the investment tools half the engineering hours and half the time to produce goods that have fewer defects-in accordance with the customer demand.  Lean manufacturing much more flexible than its predecessors. The main principle of lean manufacturing were no waiting time minimal inventory, pull based manufacturing, line balancing smaller batches, and lower process time.

CRAFT MASS PRODUCTION

In craft production producers uses highly skilled workers and simple, but flexebile tools. It produces exactly what the customer ask for- one item at a time. Exotic sports cars are an example of craft manufacturing. In mass production the producer uses narrowly skilled professionals to design products made by unskilled workers, operating expensive single purpose machines. Products are churned out in a standardized form in very high volumes. Mass producer keeps standard design in production as long as possible.

Pull System
It is the system of manufacturing based on the customer demand for the product.

Demand

Assembly

Parts Supply

Raw Materials

Push System
In this manufacturing system, the raw materials are brought into certain product line and get the products by following certain production line

Raw materials

Parts Manufacture

Assembly

Product